The FTSE 100 closed 0.6 per cent higher after fresh research showed consumer confidence has risen to its highest level in nearly two years, while traders continued to digest US Treasury Secretary Scott Bessent's decision to double a buyback programme of longer-dated US government bonds.

The GfK consumer confidence index, which polls households on how they view their finances and the economic outlook, jumped three points in August to minus 14. The figure represents the highest score since August 2024, shortly after the Labour party won the general election. The long-running barometer remains in negative territory — meaning pessimists still outnumber optimists — but is closely tracked by retailers and policymakers as an early gauge of households' willingness to spend, which accounts for the largest share of UK economic output.

Miners led the gains in London's blue-chip index after a rally in the gold price. Antofagasta and Endeavour both jumped between four and five per cent, while Anglo American — which is undergoing a major strategic overhaul to focus on copper, a metal central to electrification and power-grid buildouts — climbed 2.8 per cent as metals prices were swept up in a wider flight to commodities.

In the US, markets' gaze remained locked on the fallout from Bessent's announcement on Wednesday of plans to ramp up short-term borrowing to buy $4bn worth of 30-year Treasuries — double the amount of the previous quarter. The move, a radical attempt to keep a lid on the administration's long-term borrowing costs, initially sparked a 10 basis point fall in 30-year Treasury yields. But throughout Thursday that easing was erased, with yields climbing by as much as eight basis points even as Bessent foreshadowed further interventions. The attention is about more than US fiscal housekeeping: long-dated Treasury yields act as a benchmark for borrowing costs worldwide, feeding into everything from mortgage rates to corporate debt pricing, which is why moves at the long end of the curve draw such close scrutiny.

"We're going to increase the size of the buyback," Bessent told CNBC. "I would note that it could be more than $4bn."

Neil Wilson, investor strategist at Saxo UK, said the programme "is not a fix for the key underlying reasons why yields have broken out higher".

Gold has climbed substantially since Bessent's announcement, amid fears the move could be a precursor to more drastic bond market intervention. The yellow metal — a popular safe haven asset — rose to $4,543/oz, its highest price since early June. Meanwhile, the dollar fell to its lowest level against major currencies since April, leaving the scale of any further buyback expansion as a focal point for traders.